Oil prices drop 2% as rapid Omicron spread dims fuel demand outlook

Oil prices slumped by about 2% early on Monday as surging cases of the Omicron coronavirus variant in Europe and the United States stoked investor worries that new restrictions on businesses to combat its spread may hit fuel demand.

Brent crude futures fell $1.36, or 1.9%, to $72.16 a barrel by 0036 GMT while U.S. West Texas Intermediate (WTI) crude futures fell $1.51, or 2.1%, to $69.35 a barrel.

“Today’s Asia … weak sentiment in oil prices seems to go in line with a weakness seen in the S&P 500 and Nasdaq 100 e-mini futures,” said Kelvin Wong, market analyst at CMC Markets.

“(This is) due to fears of impending restrictions on economic activities to contain the current increasing spread of the COVID-19 Omicron variant worldwide which may increase the risk of demand slowdown.”